China & Hong Kong rebound, CSI 300 +1.71%: ETF volume surge (Oct 23)

Key takeaways

• China stocks rebounded on Friday, October 23, 2026. The CSI 300 rose 1.71% to 4,105.33 after falling as much as 1.9% in the morning, according to Yahoo Finance data and Finimize.
• The Shanghai Composite gained 0.89% to 3,690.48, the Shenzhen Component rose 2.79% to 11,673.83 and the ChiNext index jumped 4.16% to 2,684.10.
• In Hong Kong, the Hang Seng Index added 158.69 points, or 0.69%, to 23,093.37. The Hang Seng Tech Index rose 2.05% to 3,871.66, according to Futu and The Standard.
• Trading volumes jumped in exchange-traded funds (ETFs) linked to China's state-backed "national team", Reuters reported via Business Recorder. That fed speculation of official support, which has not been confirmed.
• The People's Bank of China (PBOC) set the yuan midpoint at 6.7180 per dollar, its strongest since February 2023 but far weaker than the 6.6758 Reuters estimate.

Session recap

China and Hong Kong stocks recovered part of Thursday's heavy losses in a volatile Friday session. All three main mainland indices opened lower and then rallied in the afternoon. Hong Kong's Hang Seng dipped to an intraday low of 22,803.77 before closing higher, Futu reported. Hong Kong turnover was HK$249.78 billion, according to Futu. This brief follows our October 22 China & Hong Kong brief and our explainer on why the CSI 300 entered a bear market.

Changes and percentages are calculated from the previous closes: Shanghai 3,658.03, Shenzhen 11,357.32, ChiNext 2,576.90, CSI 300 4,036.30, Hang Seng 22,934.68 and Hang Seng Tech 3,793.93 (Xinhua, Futu and Yahoo Finance). A lower midpoint means a stronger yuan; the previous fixing was 6.7195. The onshore yuan traded at 6.6725 per dollar at 03:04 UTC, Reuters reported via Business Recorder; a verified onshore close was not available. A full-day southbound Stock Connect figure for October 23 was not available at the time of writing. On October 22, mainland investors were net sellers of HK$9.218 billion of Hong Kong stocks, according to BigGo Finance.

What drove it

Suspected state support through ETFs

The main driver reported on Friday was heavy trading in large index ETFs. Reuters, via Business Recorder, said volumes jumped in ETFs popular with the "national team", a nickname for state-backed investors, and that this fed speculation of official support. The South China Morning Post said Central Huijin Investment and other state-backed funds might have stepped in. Neither the funds nor the regulators confirmed any buying.

BigGo Finance reported that by 13:36 local time (05:36 UTC), the E Fund ChiNext ETF, the Huatai-PineBridge CSI 300 ETF and the ChinaAMC STAR 50 ETF had each traded more than 10 billion yuan. The same report said broad-based index ETFs drew about 51.7 billion yuan of net inflows on October 22 alone.

Tech and AI hardware bounce

Growth stocks led the recovery. The ChiNext index, heavy in technology and battery firms, rose 4.16%. The SCMP reported that optical transceiver makers announced share buybacks or reassured investors after the steep falls earlier in the week. In Hong Kong, AI developer MiniMax jumped 16.7% to HK$160.7 and Z.AI gained 8%, The Standard reported. Tencent rose 0.94% and Alibaba 0.46% after Thursday's regulatory-driven slide. Our Japan brief covers the same session in Tokyo.

Banks lagged in Hong Kong

The Hang Seng's smaller gain reflected weakness in lenders. ICBC fell 1.5%, BOC Hong Kong 1.57% and HSBC 1%, while Lenovo was the worst blue chip, down 2.25%, The Standard reported. Aluminum Corporation of China (Chalco) led blue-chip gains with a rise of nearly 7%.

Macro worries remain

Reuters pointed to a lack of domestic fiscal stimulus. Finimize said Morgan Stanley cited weak domestic demand and tight liquidity. RBC Wealth Management pointed to disappointing earnings and limited fiscal support, and warned that volatility could last into early 2027 without new policy or technology catalysts, Finimize reported.

Currency

The yuan was on track for a fourth straight weekly gain, according to Reuters via Business Recorder. The PBOC's fixing was its strongest since February 2, 2023, but it was 422 pips weaker than the Reuters estimate.

Sentiment (descriptive)

Despite Friday's gain, the CSI 300 fell 1.6% over the week, its 11th straight weekly decline, and stood about 19% below its June 22 peak, Finimize reported. Using Yahoo Finance closes, the Hang Seng lost 4.52% over the holiday-shortened week from its October 16 close of 24,186.83. Hong Kong was closed on October 19 for the Chung Yeung Festival.

Political & policy watch

• PBOC framework changes: At the Financial Street Forum in Beijing on October 19, PBOC Governor Pan Gongsheng announced a liquidity backstop for large redemptions at non-bank financial institutions, to be set up with the National Financial Regulatory Administration and the China Securities Regulatory Commission, according to the speech text published by the BIS. He described it as a stabilization tool for the bond market. The speech did not announce measures aimed at stocks.
• Rates on hold: On October 20, the PBOC kept its one-year loan prime rate at 3.0% and the five-year rate at 3.5%, Reuters reported via Investing.com. Pan said the PBOC may later shift its main open market operations to an overnight tenor.
• US–China trade truce: US Treasury Secretary Scott Bessent has said the truce runs to January 10, 2027, CNBC reported. Several measures, including China's pause on some rare-earth export controls, are due to lapse on November 9–10 unless extended.

What to watch next

• October 27, 01:30 UTC: China's September industrial profits (NBS release calendar).
• October 27–28: US Federal Reserve policy meeting. Hong Kong's currency peg links local rates to Fed decisions.
• October 31, 01:30 UTC: China's official October PMIs (NBS).
• November 9, 01:30 UTC: China's October CPI and PPI (NBS).
• November 9–10: scheduled lapse of several US–China truce measures unless formally extended.

Track Asian and global markets on our markets dashboard.

Risk checklist for readers

• Unconfirmed support. Talk of state buying is inferred from ETF volumes; such support is not announced and can stop without notice.
• One day is not a trend. Weekly and monthly data give a fuller picture than a single rebound.
• Index make-up matters. ChiNext and Hang Seng Tech are concentrated in growth stocks and tend to swing more than broad indices.
• Currency effects. The onshore yuan may trade up to 2% either side of the PBOC midpoint. Exchange-rate moves change returns for overseas investors.
• Scheduled events. PMIs, the Fed meeting and the trade-truce dates can raise volatility around release times.
• Check final figures. Vendor data can differ slightly. Exchange and index-provider releases are the reference for final values.

Sources

• Yahoo Finance: CSI 300 Index (000300.SS)
• Yahoo Finance: SSE Composite Index (000001.SS)
• Yahoo Finance: Shenzhen Component (399001.SZ)
• Yahoo Finance: ChiNext Index (399006.SZ)
• Yahoo Finance: Hang Seng Index (^HSI)
• Futu: Hong Kong stock market close (Oct 23)
• The Standard: Hong Kong shares close higher, MiniMax advances 16 percent
• Xinhua: Chinese shares close lower Thursday
• Finimize: China stocks rebound as state-backed ETFs heat up trading
• Business Recorder (Reuters): China stocks slide as blue chips head for longest weekly losing streak
• South China Morning Post: Chinese stocks bounce back from bear market on suspected state support
• BigGo Finance: China's broad-base ETFs draw over 160 billion yuan in six days
• BigGo Finance: Southbound funds pull out HK$9.2 billion in a single day
• Newsquawk: PBoC sets USD/CNY midpoint at 6.7180
• Business Recorder (Reuters): China's yuan holds steady, set for fourth weekly rise
• BIS: Pan Gongsheng, Thoughts on several issues of interest to the market
• Reuters via Investing.com: China leaves loan rates steady for 17th month
• CNBC: US–China trade truce extended, Bessent says
• Technology.org: China's rare-earth export pause and the November 10 date
• Federal Reserve: FOMC meeting calendar
• National Bureau of Statistics: Regular press release calendar 2026

This article is for information only and is not investment advice.